Brookwood businessman accused in $1 million fraud scheme

A Brookwood businessman has been charged with bribing a member of the U.S. Coast Guard in order to receive more than $1 million in fraudulent federal contracts.

By Stephanie TaylorStaff Writer

A Brookwood businessman has been charged with bribing a member of the U.S. Coast Guard in order to receive more than $1 million in fraudulent federal contracts. Huffman Earl “Butch” Monk, 51, of Brookwood and Nathan Dunn, 29, a former Coast Guard transportation administrator who now lives in Brookwood, face dozens of federal charges in Virginia. They were scheduled to appear in U.S. District Court in Norfolk, Va., on Monday.According to a federal grand jury indictment filed in the case, Monk and Dunn worked together to obtain overpriced and fictional contracts to transport shipments to Coast Guard bases across the country. Monk owns and operates 12 freight brokerage companies based on Chigger Ridge Road in Brookwood, the indictment states. “He will plead not guilty and vehemently fight these charges,” said Birmingham attorney Ezra Jordan, who represents Monk and his businesses here. Jordan assisted Monk in finding representation in Virginia. Monk faces 29 counts of paying a bribe to a public official, 22 counts of wire fraud, one count of conspiracy and one count of making a false statement. Dunn is charged with conspiracy, 22 counts of wire fraud, 14 charges of accepting a bribe while acting as a public official and making false statements to Coast Guard investigators.The alleged conspiracy began in September 2009 and lasted until November 2011.“As a result of the conspirators’ illegal and fraudulent actions and transactions, Monk’s companies fraudulently received from the United States government over $1 million in additional revenues to which they were not entitled, and the United States government was defrauded of over $1 million,” the indictment states.According to a federal grand jury indictment found in online court records, Dunn’s job as a transportation administrator was to coordinate shipments of Coast Guard freight, such as boats, trailers, generators and other military equipment.His job included assigning government freight contracts by entering data into a computerized database of freight carriers used to ship goods.That system returned a list of 150 to 300 carriers qualified to make certain shipments, ranked in order with the lowest-priced carriers first. Government policies allow carriers to be chosen based on factors, such as their fee, past performance and availability. The regulations do not allow a transportation administrator to choose a more expensive freight carrier unless there is a legitimate reason. According to the indictment, Dunn used an override command in the system to circumvent the generated rate sheet and award Monk’s companies overpriced contracts. The indictment alleges Dunn included unnecessary charges, listed non-existent contract numbers and awarded contracts to Monk’s companies that didn’t appear on the generated list of qualified carriers, according to the indictment. He also allegedly awarded contracts to Monk’s companies for cargo shipments that did not exist.“The object of the conspiracy was for Monk to corruptly pay bribes to Dunn, who thereafter awarded fraudulent and grossly overpriced contracts on USCG freight shipments to one of 12 freight brokerage companies owned and operated by Monk, while bypassing hundreds of lower-priced carriers and freight brokers,” the indictment charges.Monk allegedly opened a credit union account, a joint bank account at RBC Bank and funded a debit card so Dunn could access bribery payments of more than $220,000 over the two years. According to the indictment, Dunn withdrew cash from those accounts and made purchases that included $2,111 at an Apple store, $1,057 at a Ruth’s Chris Steak House and $2,500 for a used Audi SUV.The indictment demands forfeiture of Monk’s property allegedly obtained with proceeds from the alleged criminal activity, if he is found guilty. The list includes a subdivision in Moundville, 750 acres on Chigger Ridge Road, 120 acres on Big Hurricane Road, a store and six acres on Covered Bridge Road and three other properties and structures in Brookwood.